Address to the Rural Press Club Agribusiness Breakfast

MELBOURNE
WEDNESDAY, 12 OCTOBER 2023

Good morning

Thank you Bryce, Alex and thank you all for joining us today at the Rural Press Club of Victoria’s Agribusiness Breakfast. 

I’d like to start by acknowledging the Traditional Owners of the lands on which we’re gathering and pay my respects to elders past, present and emerging. 

This weekend we have the chance to give real meaning to that acknowledgement, by recognising our First Peoples in our nation’s constitution.  

Just as we will get better outcomes by listening to each other in the ag sector, we’ll get better results for our First Peoples if we listen to them, through a Voice to Parliament.

That’s what this is about. 

I’d also like to acknowledge my Victorian Senate colleague, Senators Raff Ciccone, both of whom do a terrific job advocating for Victoria’s ag sector. 

DISASTER RECOVERY & PREPAREDNESS 

While most of my remarks today will relate to agriculture, I want to start by putting on my Emergency Management Minister hat and acknowledge the severe natural disasters that have occurred in Victoria over the past few weeks as well as the past few years. 

Because of where they occurred, these disasters have impacted heavily on the agricultural sector, more so than any other industry. 

Last week’s fires, followed just days later by flooding in the Gippsland region shows that climate volatility is becoming more regular. 

It’s not often that we need to activate both bushfire and flood assistance for the same area at the same time, but that’s what we have done for East Gippsland and Wellington Shire.

In partnership with the Victorian Government, we have also activated flood assistance for another 6 local government areas to help individuals with emergency relief and debris removal, along with asset repair support for Councils. 

Of course, these recent events follow what was a massive flooding event late last year. 

In the aftermath of those floods I visited Wodonga, Mildura, Bendigo, Seymour, Rochester, the Darraweit Valley and Echuca and saw firsthand the damage the flood waters caused. 

The Albanese Government has committed to cost-share over $1.1 billion in recovery assistance under DRFA for Victorian communities affected by the floods that started in October 2022. 

That funding has made a real difference to Victorians recovering from those terrible floods. 

I certainly acknowledge that the rollout of repairs has not been as swift as any of us would have liked.

There are a range of factors causing this, namely labour and supply shortages.

Over the last month I tasked my agency to embark on a DRFA roadshow to every state and territory, to sit down with governments face to face and work through any issues they may have.

The impact of these events on farming businesses is not just felt at the time, but long into the aftermath as important supply routes need to be repaired.

But it is vital that these roads are built back better, not just to the same level. 

Fourteen of the most severely impacted councils from the October 2022 floods have received funding to improve the resilience of essential public assets like roads, bridges and footpaths damaged as a direct result of the flood event. 

Betterment works mean infrastructure can be built back using more resilient methods or materials, so they’re less likely to be impacted again by future natural disasters. 

It’s another example of the different approach of the Albanese Government when it comes to disaster management.

To take action now, to protect Australians and ensure we’re better prepared for the disasters we know will come. 

BIOSECURITY 

Protecting us from future threats has also been a key focus for us in the agriculture portfolio. 

Almost from our first day in office, the Albanese Government has taken decisive steps to protect our agriculture sector from growing biosecurity threats. 

Strong measures on foot and mouth and lumpy skin disease to protect the livestock industry. 

The first ever National Biosecurity Strategy, to map a cooperative way forward, with States, Territories and industry.  

And in our May budget you might have seen that we delivered Australia's first ever sustainably funded biosecurity system. 

I was pretty shocked to learn that the biosecurity budget we inherited was on track to fall by about 25%, because it was built on temporary, short-term funding. 

At a time when we face more biosecurity threats, I couldn’t believe - and wouldn’t accept - the cut to biosecurity funding that our predecessors had built in.

There is simply too much at stake to cut corners. 

So I was very pleased that my Cabinet colleagues supported my ask for over $1 billion in new funding over four years for our biosecurity operations.  

Now, there’s been a lot of talk about who will bear the cost of this increased funding, so I’d like to take a moment to explain. 

The key point is that the costs of this new sustainable system will be shared between taxpayers, risk creators and the direct beneficiaries of the biosecurity system. 

As I’ve explained, taxpayers - through their government - will chip in a significant increase to biosecurity funding. 

Those of you who travel overseas will now pay an extra $10 per ticket, in recognition of the risk created by travellers entering Australia.  

But something that many haven’t recognised is that importers are now also paying more.  

I listened to the calls from producers to charge importers more, seeing as their shipping containers and other goods are one of the largest creators of biosecurity risk. 

In fact, we had already begun increasing fees and charges on importers in January this year, to help reduce the risk of hitchhiker pests, like khapra beetle. 

And then in our May Budget, we decided to raise fees and charges on importers, so that they actually pay the cost of the biosecurity services we provide. 

Again, I was surprised to learn that biosecurity fees and charges had not been properly reviewed since 2015, which meant that importers weren’t paying the full cost of the services they received, with taxpayers picking up the tab. 

For all the Opposition’s talk about container levies – which they scrapped in office – they never actually made importers pay their way. 

As of the end of last month, as a result of our changes, cost recovery from importers has totalled $83.2 million since July 1.  

This includes an extra $9.4 million in additional revenue as a result of the increased fees and charges, which were not paid by importers previously. 

With our changes, for the first time, importers will pay their fair share. 

So government and importers are paying more, for the improvements we are making.  

Which leaves producers. 

My view was that our farmers should not bear the full cost of biosecurity operations, but as the direct beneficiaries of the system, it was reasonable to ask them to make a small contribution.  

So that’s why we’re implementing a Biosecurity Protection Levy on domestic agriculture, fisheries, and forestry producers, which will commence on July 1st, 2024. 

What that means for an apple grower - 0.18c per kilo of apples and for an egg farmer - 3.25c per laying chick.

In total, that will see farmers pay only 6% of the cost of biosecurity operations, with the vast majority borne by taxpayers and importers. 

A very small contribution, when you consider the billions of dollars at stake.  

There is a lot to be done and a lot still to be decided.  

The consultation period on the new biosecurity protection levy closes this Friday and I encourage you to get involved via the Department of Agriculture website. 

TRADE 

Protecting our industry from biosecurity threats and the changing climate is so important for our government because it allows the continued growth of our agricultural industry. 

As a predominantly export based industry, it is vital that agriculture has a government that not only advocates for it, but also delivers for it. 

That’s what the Albanese Government is doing for the agriculture sector. 

The respectful relationships we’ve forged helped progress the ratification of free trade agreements with countries like the UK and India.

As a result, last month we saw tariff-free raw sugar from Queensland arrive in the UK – the first shipment in 50 years, with similar opportunities now open for Victorian producers.  

And Aussie avocados, wine, seafood and sheep meat are now on sale in upscale Indian supermarkets, with huge potential to grow.   

Victoria’s horticulture sector will also benefit from the work we’re doing to diversify our export markets, with agreements for new market access or reduced export tariffs in emerging markets like Vietnam, Thailand and Japan. 

All of you will be aware of our government’s work to stabilise our relationship with our biggest trading partner, China. 

Our approach has been to cooperate with China where we can, disagree where we must and engage in our national interest. 

Over the last few months, China has removed trade impediments on our exports of barley, timber, horticulture, cotton and, most recently, hay.  

Restoring those markets is worth well over $1 billion per year. 

This progress affirms the calm and consistent approach that the Albanese Government has taken. 

There’s still a lot more work to be done particularly to restore full trade for Australian beef, lobster and wine to China. 

But there’s no denying that our work with industry to open new markets is delivering for local producers. 

WINE DASHBOARD 

Victoria is such an important producer of Australian wine, and home to more regions and individual wineries than any other state in Australia.  

I understand its diverse climates also means virtually every imaginable wine style is produced within Victoria! 

But I know some parts of the industry are doing it tough, particularly the warm inland regions across Victoria, NSW and South Australia.  

We are helping drive demand for Australian wine by helping our exporters access new markets and strengthen their market presence but we are also focussing domestically on making sure growers have the tools and information they need during challenging periods. 

Today, with the help of Wine Australia’s CEO Dr Martin Cole, I am launching Wine Australia’s Grape Price Indicators dashboard, an interactive online dashboard that gives a clear picture of the future direction of commercial winegrape prices. 

As part of funding from the Improving market Transparency in Perishable Agricultural Goods Industries Program, I’m delighted that this tool will help meet growers’ needs for greater price transparency.  

It will help to redress the power imbalances that have traditionally existed in the winegrape and other perishable goods supply chains.  

The dashboard brings together 12 different data sources and displays 21 charts in a user-friendly layout.  

This will be a useful tool in addition to our broader programs such as the Farm Household Allowance, access to concessional loans through the RIC and free financial counselling through the Rural Financial Counselling Service, for which I just recently announced an extension through to 2026. 

We know parts of the winegrape sector in Australia are experiencing significant pressures, but this tool will provide grape growers the insights needed to make informed business decisions.  

VICTORIAN SECTOR

Before wrapping up, I just want to quickly address touch on a few current issues affecting particular sectors.  

I know there has been a lot of concern about the big decline in sheep and cattle prices. 

As MLA, Rabobank and others have observed, good seasons, restocking and concerns about drought are causing an oversupply and offloading of livestock, which is driving down prices for farmers. 

In fact, national lamb saleyard prices have been falling since around mid-2021.

And while last week saw a slight uptick in prices following some of that good rain we had, I acknowledge the very real pain the price falls are causing producers. 

I know our processors are working extra hard to take as many lamb and sheep as possible. 

MLA recently reported that September was the second highest month on record for the export of lamb and mutton, with nearly 48,000 tonnes heading overseas. 

This will take a while to work through, but it shows the importance of opening those new markets that I mentioned earlier. 

But while some grains and some other agricultural sectors are seeing production values decrease as we enter the El Niño cycle, horticulture is set to withstand the incoming weather conditions. 

The gross value of production is expected to rise to a record $17.6 billion in 2023-24 despite drier conditions. 

Fruit and nuts (excluding grapes) and vegetables are forecast to increase by 8% and 6% respectively in 2023-24.  

We know in recent years that industry has been seeing higher input costs and supply shocks, resulting in rising prices. 

Despite these challenging conditions, exports are expected to rise by 9% to $3.7 billion in 2023-24 which is really great to see. 

I’m also pleased that our milk producers are also in a strong position right now, with 2022–23 at $9.40 a kilogram for milk solids – only slightly below the record high of the 2021–22 season.  

Dairy is the third largest rural industry in Australia and a key sector of the agricultural economy, generating close to $4.9 billion in farmgate value in the 2021-22 financial year, just over $3 billion from Victoria. 

The good news is that dairy farm incomes have never been higher. 

The average farm cash income across all dairy farms in Australia in 2022–23 is projected to be $361,000 per farm – an increase of 10% on the previous year, and a record high for the industry in real term.  

CONCLUSION 

There is so much happening in our agricultural sector that it’s hard to capture it all in a single address, but I’m thrilled to have opportunities like today to showcase and talk about this work. 

Victoria has always been a big contributor to our national agriculture story.   

I look forward to continuing to collaborate with all of you to keep it that way.  

Thank you.